Terming elevated food prices a temporary phenomenon, Economic Affairs Secretary Tarun Bajaj on Tuesday said it should be back to normal soon on the back of arrival of new crops and government measures for improving supply of essential commodities.
Some commodities like onion, potatoes and tomatoes are as costly as Rs 100 per kg, much higher than the average price.
Pushed by rising prices of essential kitchen items, retail inflation rose to an eight-month high of 7.34 per cent in September. The Consumer Price Index (CPI)-based inflation was 6.69 per cent in August and 3.99 per cent in September 2019. The inflation has been hovering above 4 per cent since October 2019. The previous high in the CPI was witnessed at 7.59 per cent in January 2020.
The Wholesale Price Index (WPI)-based inflation rose to 1.32 per cent in September 2020, mainly on the back of costlier food articles.
"I think this should be temporary in our view... There is actually a difference between the WPI and the CPI. So, that itself shows that this should be something to do with logistics and with good agricultural season that is coming and the new crop with us we are hoping that this should cool down," Bajaj said.
Nevertheless, he said agriculture and consumer affairs ministries have also announced some steps to cool down the prices.
"We think that it is a temporary affair and it should be back to normal soon and also limited to few commodities," he said.
Onion, a politically-sensitive commodity, remained the costliest in the retail markets of Bengaluru at Rs 100 per kg on Monday despite Karnataka being the third-largest producer of the kitchen staple in the country, according to government data.
The average all-India daily price of onion was ruling as high as Rs 70 per kg on Monday.
Consumers even in the large growing regions are paying elevated rates for the key kitchen item.
Despite Maharashtra being the top onion producing state in the country, retail price of the commodity in Mumbai was a hefty Rs 77 per kg.